grievance disputes by mediation failed, Presidential emergency boards were created, after strike dates were set. In the fiscal year 1950, 6 out of a total of 11 emergency boards created during that period involved grievance disputes, which, according to the National Mediation Board, should have been disposed of by the First Division, under the act.

For instance, prior to a strike against a principal carrier system which lasted some 45 days, the Presidential fact-finding board "sought vainly to secure acceptance of procedures for settling the dispute and averting the threatened strike." It pointed out that "the grievance cases should have been submitted to the National Railroad Adjustment Board, and criticized the practice" of bypassing that agency by calling strikes to secure the appointment of emergency boards. The unions, however, rejected this finding. The emergency board warned:

It seems inconceivable to us that a coercive strike should occur on one of the Nation's major transportation systems . . . in view of the fact that the Railway Labor Act provides an orderly, efficient, and complete remedy for the fair and just settlement of the matters in dispute. Grievances of the character here under discussion are so numerous and of such frequent occurrence on all railroads that the general adoption of the policy pursued by the organizations in this case would soon result in the complete nullification of the Railway Labor Act.

In another serious controversy involving more than 1,400 grievance cases which remained unsettled on the property of a carrier system, the emergency board announced that in its mediatory capacity it had induced the parties to make a settlement. By the terms, creation of a regional board of adjustment under the Railway Labor Act was provided for, to which the unsettled claims were to be referred.

The National Mediation Board recommended in its 1950 report that a conference of major executives of the railroads and the operating brotherhoods be held without further delay in order to devise some workable method for eliminating the "log jam" of cases in the First Division. It also recommended that a more determined effort be made to dispose of a larger proportion of cases without the intervention of a referee. In addition, it pointed to a definite need for some understanding between the carriers and the brotherhoods as

to the extent to which awards of the First Division should serve as precedents.

Peaceful Mediation

According to the National Mediation Board, the Railway Labor Act again proved its value in the fiscal year 1950 in providing mediation procedures for the amicable settlement of 234 labor disputes. Since the amendment of the act in 1934, 3,368 cases have been similarly disposed of. "Against this total," the National Mediation Board pointed out, "the few instances in which work stoppages occurred should stand out as sound evaluation of the benefits of successful use of the act's procedures." As of June 30, 1950, 102 mediation cases remained on the Board's docket.

Among matters of concern to the Board during the fiscal year 1950 were the following:

(1) Failure of disputants to utilize, or comply with, "the very complete procedural provisions of the act."

(2) Apparent reluctance of both carriers and labor organizations to conduct thorough collective bargaining in national cases. The "short-circuiting" of negotiations to secure governmental assistance was deplored.

(3) Similarly, too great reliance on appointment of Presidential fact-finding boards; also the tendency, at times, to reject the findings and recommendations of such boards.

(4) The large number of cases deadlocked by the National Railroad Adjustment Board, requiring the services of referees appointed by the Government.

(5) Need for investing representatives in negotiations with sufficient authority to effect a settlement.

(6) Jurisdictional disputes between two or more abor organizations.

For settling controversies and avoiding strikes, as well as obviating the necessity for emergency boards, in the railroad and air-transportation industries, the National Mediation Board outlined three steps: First, settling as many disputes as possible in direct negotiation and real collective bargaining; second, invoking the assistance of mediation for effecting a "meeting of the minds"; and third, voluntary acceptance by both parties of arbitration in issues that remain unresolved.

Only a few Presidential emergency boards were created under the amended Railway Labor Act of 1934 during the 8 years prior to World War II.o In May 1942, a National Railway Labor Panel was created by Executive order during the wartime emergency, which functioned until August 1947. Under this Panel, emergency fact-finding boards supplemented procedures under section 10 of the act. These boards were appointed from panel members in unsettled dispute cases in which no strike vote had been taken, after mediation by the National Mediation Board had failed and arbitration had been rejected. A strike vote and a definite strike date are prerequisites under section 10 before the National Mediation Board may report the threat of an emergency to the President.

In the early days of World War II, the standard railway labor organizations and the carriers agreed that there should be no strikes or lockouts and that all disputes would be settled by peaceful means. During the existence of the National Railway Labor Panel, 58 panel emergency boards were provided. With the exception of a few cases, reported the National Mediation Board, the

recommendations of these boards were accepted by the parties in settlement of the disputes.10 The panel emergency boards certified that recommended wage changes were to conform with the general wage stabilization program of the day."

' Information is from Sixteenth Annual Report of the National Mediation Board, Including the Report of the National Railroad Adjustment Board, for the Fiscal Year Ended June 30, 1950. Washington, 1950.

For background material, earlier annual reports were utilized; and also Fifteen Years Under the Railway Labor Act, Amended, and the National Mediation Board, 1934–49 (U. S. National Mediation Board, Washington, 1950).

The National Mediation Board is the chief administrative agency under the Railway Labor Act. Its principal work consists in mediating disputes in railroad and airline industries which involve changes in rates of pay, rules, or working conditions; and determining collective bargaining agents in disputes concerning representation of employees. The National Railroad Adjustment Board has jurisdiction of employee grievance disputes and controversies over the application and interpretation of existing agreements in the railroad industries.

The more prominent disputes in the railroad industry were those in connection with the manning of Diesel locomotives and the establishment of the 40-hour week for "operating" employees.

4 Fifteen Years Under the Railway Labor Act (p. 54).

Involving change in rates of pay, rules, or working conditions.

For a summary of the situation during the previous year, see Monthly Labor Review, April 1950 (p. 403).

? I. e., engineers, firemen, hostlers and outside hostler helpers, conductors, trainmen, and yard-service employees.

• Information compiled from earlier annual reports of the National Mediation Board and from Fifteen Years Under the Railway Labor Act (pp. 32-33, 84-89).

• Fiscal years 1935 to 1942 inclusive. (See first to eighth annual reports.) 10 Fourteenth annual report, 1947-48 (p. 52).

11 Tenth annual report, 1943-44 (p. 36); see also Fifteen Years Under the Railway Labor Act (p. 33).

Longevity of

Railroad Annuitants 1

FOUR OF EVERY FIVE railroad workers who retired at the age of 65, under the Federal Railroad Retirement Act, during the years 1936 to 1948, were still alive 5 years after their retirement, and nearly three out of five were still on the rolls 10 years after their annuity began, according to a recent mortality study made by the Railroad Retirement Board. Even those who did not retire until 70 were living, in almost three out of four instances, at the end of 5 years of retirement. Nearly half of this older group were still alive at the end of 10 years.

Percentage of surviving railroad annuitants who retired at specified ages during 1936-48, by years of survival

The superior longevity of railroad annuitants over the general population is due in part, according to the Railroad Retirement Board's study, to the fact that the railroad annuitants are a hardy group, having generally been able to remain at work until an advanced age. Moreover, the statistics for railroad annuitants exclude those retired for serious disability, who consequently have a heavier mortality than other railroad annuitants. In contrast, the figures for white males in the general population are based on mortality of all men, irrespective of whether they were able to work late in life or had become seriously disabled earlier.

Life Expectation After Retirement 2

Railroad workers retiring at age 65 may expect, as a group, to survive for an average period of 13.0 years; those retiring at age 70, for an average

1 Information is from Monthly Review, U. S. Railroad Retirement Board, Chicago, February 1951 (pp. 22–25).

• Life expectancy figures are group averages only and have no application to Individuals as such.

Interim Adjustment

of Consumers' Price Index

ECONOMIC, MILITARY, AND LEGISLATIVE developments during the summer of 1950 made necessary certain interim improvements in the Consumers' Price Index in advance of the comprehensive revision scheduled for completion in June 1952.1 No major changes in procedures or weights had been made since the full scale revision of 1940.

When this program was begun, it was expected that no important changes would be made in the index until the general revision was completed. This assumed that the period of 1950-52 would be one of relatively stable economic conditions with moderate and comparatively uniform price movements. This expectation was dispelled by the sharp and diverse price movements following June 1950. These changes magnified the effects of the mis-weighting of the components of the index.

One phase of the adjustment, namely, correction of the new unit bias in the rent index, had been planned and announced in 1949. Other improvements, such as introduction of new or substitute items, were comparatively minor and routine; but some represent departures from customary practices. Because these changes, in the aggregate, seemed likely to affect the trend of the index from January 1950 and into the future, the Bureau of Labor Statistics took pains to announce them in advance and document them in detail.

Plans for Interim Adjustment

Three major considerations underlie the general planning of the interim adjustment, which should be considered an improvement of the 34-city index as presently constructed and defined: (1) not to make adjustments of basic concepts or methodology prior to the comprehensive revision, (2) to make

the adjustments quickly, and (3) to make only such changes as would result in demonstrable improvements.

The scope of the adjustment embraced four major parts:

1. Revision of city population weights.

2. Correction of new unit bias in rent index: 3. Addition of new items.

4. Revision of commodity weights.

Revision of Population Weights

Publication of the 1950 decennial census population data by city and county made possible the calculation of revised population weights for combining 34-city data into a national index for all items, and 56-city data into a national food index. Previous city weights in the index were based on Bureau of the Census estimated population counts for 1942 derived from May 1942 registrations for sugar rationing. In the index weights, each city bears a weight based on its own population and that of other metropolitan areas in the same region.

2

In calculating revised 1950 weights, the population of standard "metropolitan areas" as defined by the Census was used. The metropolitan area, or entire county in which the central city is located as well as adjacent counties which are closely related to it economically, has replaced "metropolitan districts" as used in 1940.3 Essentially the same combination of nearby cities with index cities was maintained in calculating the city weights. A tabulation of the 1942 and 1950 population weights will be presented in the reprint of this article.

Correction of the Rent Index

As part of the interim adjustment of the Consumers' Price Index, the corrections to the rent index and the "all items" index for the "new unit bias" have been incorporated into the index num

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bers from January 1950 to date. The nature of this correction is described in detail in another technical note in this issue.

The amount of the rent corrections, as applicable to the October 1950 indexes, was carried as a footnote to all index releases from October through December 1950. The ultimate incorporation of this rent correction into the index had the effect of raising the national rent index for January 1950 by 6.8 index points, and the national "all items" index for January 1950 by 1.3 index points.

Addition of New Items

No general review of the sample of items priced for the index was feasible for the interim adjustment. However, a few items which had greatly increased in importance in family spending since the mid-thirties were added. A few additional items were included to improve the measurement of average price movements for groups or subgroups of similar items. Frozen peas, strawberries, and orange juice concentrate, canned baby food, group hospitalization payments, home permanent wave refills, television sets, and beer were added because of their increased importance; layer cake, frankfurters, ice cream, cola drinks, grape jelly, men's rayon suits, men's work gloves, women's rayon blouses, boys' jeans, cotton rugs, chrome dinette sets, electric toasters, aluminum pans, velocipedes, and gas for space heating were added to improve the measurement of price change.

These items were introduced into the index calculations at the first period for which reliable prices were available. For the January 1951 index,

prices were available in most cities for all new items except beer. It is expected that reliable prices for this item will be available within a few months.

Revision of Commodity Weights

The unrepresentativeness of current index value weights as related to current spending patterns was the most compelling reason for making the interim adjustment. Table 1 indicates the extent of the weight dislocation in the January 1950 index.

To understand why the weight structure of the index became unrepresentative, the reader should review the mechanics of the index calculation.1 Since food prices have increased more than other groups, the value weight of food in the national index has increased as a percent of the total value of the market basket-from 35 percent in 1934-36 to more than 40 percent before the adjustment.

Only if people had continued to buy the same quantities of all goods and services, would foods actually represent 40 percent of family expenditures. The Bureau's postwar studies indicate, on the contrary, that foods continue to take about one-third of the consumer's dollar. This shows that consumers have adjusted their spending patterns to increased income and higher prices by purchasing different things in different quantities. The index procedure necessarily holds quantity weights constant from month to month. It cannot take continuous account of changes in spending patterns. That is why, periodically, the Bureau must conduct new family expenditure surveys and adjust weights accordingly.

Commodity group